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U.S. Senate Approves New Iran Sanctions

An Iranian security guard stands outside the building housing the reactor of Bushehr nuclear power plant
WASHINGTON -- The U.S. Senate has approved tough new unilateral sanctions aimed at squeezing Iran's energy and banking sectors, which could also hurt companies from other countries doing business with Tehran.

The Senate passed the bill 99-0. The House of Representatives was expected to follow suit later in the day, then the measure will go to President Barack Obama to sign into law.

Congress' intent is to pressure Tehran into curbing its nuclear program, which Washington suspects is aimed at making a bomb.

Lawmakers from both parties have been pushing for months to tighten U.S. sanctions on Iran. At the Obama administration's request, they held off until the United Nations Security Council and the European Union agreed new multilateral sanctions. But the lawmakers then declared that still tougher measures were needed.

"The U.N. sanctions, though a good first step, are quite tepid. And they are tepid because there are other members of the Security Council who want to keep doing that business with Iran ... The United States therefore has to pass these unilateral sanctions," Senator Barbara Mikulski (Democrat-Maryland) said during debate in the Senate.

The legislation penalizes companies supplying Iran with gasoline as well as international banking institutions involved with Iran's Islamic Revolutionary Guard Corps, its nuclear program or what the United States calls its support for terrorist activity.

It would effectively deprive foreign banks of access to the U.S. financial system if they do business with key Iranian banks or the Revolutionary Guards.

Global suppliers of gasoline to Iran could also face bans on access to the U.S. banking system, property transactions and foreign exchange in the United States.

"Because of this legislation, we will be posing a choice to companies around the world. Do you want to do business with Iran, or do you want to do business with the United States? We don't think that's much of a choice, but we will force companies to make it," Republican Senator John McCain said.

The Obama administration tried but failed to get U.S. lawmakers to make blanket exemptions for countries that are cooperating with multilateral efforts to isolate Iran.

The legislation only allows the president to waive the new sanctions on companies from "cooperating" countries on a case-by-case basis, for 12 months.